Hawaii announces first cohort of its digital currency sandbox

hawaii digital currency sandbox

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  • The Digital Currency Innovation Lab (DCIL) has shortlisted 12 companies.
  • The companies will be allowed to transact in digital currencies without having a money transmitter license.
  • DCIL will run a two-year program to help legislators create a policy on digital currencies.

The Hawaii Technology Development Corporation (HTDC) has announced the first batch of participants of the state’s Digital Currency Innovation Lab (DCIL) program through a press release published on August 19, 2020. The selected companies will carry out crypto-related activities without acquiring the state’s money transmitter license.

DCIL was launched on March 17th  through a partnership by the state’s Department of Commerce and Consumer Affairs, The Division of Financial Institutions (DFI) and HTDC.

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According to the statement, the two-year program has been accepting applications since March and has received submissions from 19 applicants.

Len Higashi, the executive Director of HTDC, is impressed by the response by companies. He stated,

“The response we have received from participating companies and the community is testament to the value of our program in advancing the potential adoption of digital currencies in the state. Through the DCIL, we hope to identify opportunities for economic development through this effort and very optimistic that we will be able to do so.

Hawaii’s DCIL first cohort

After a comprehensive review, 12 digital currency issuers were shortlisted. They are Apex Crypto, bitFlyer USA, BlockFi Trading, CEX.IO, Cloud Nalu, Coinme, ErisX, Flexa Network, Gemini Trust Company, Novi Financial, River Financial and Robinhood Crypto. During the program, these companies will provide critical metrics that will be specified by DFI. Through the data collected from these companies, legislators will be better placed to come up with policies touching on digital currencies.

When welcoming the participating companies, the State’s Commissioner of Financial Institutions, Iris Ikeda, commented,

We are excited to welcome our inaugural batch of participants into the DCIL. Hawaii-based consumers can look forward to a variety of options for services offered by digital currency companies in the state.

Crypto regulation in Hawaii

Since the introduction of double-reserve requirement in the state back in 2017, crypto activity in Hawaii has been dwindling. Some of the companies that called it quits in Hawaii include Coinbase. Through the sandbox, HTDC hoped to address the concerns of crypto companies that were driven out by the requirement. However, the vision of Hawaii for blockchain is unclear once the sandbox is over.